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Louisiana Hurricane Insurance: Fact File

MAY 2017

The costliest Louisiana hurricane ever was Hurricane Katrina, which caused nearly $25.4 billion in insured losses in Louisiana in 2005 (about $31.0 billion in 2016 dollars). These loss statistics do not include flood damage covered under the federal government’s National Flood Insurance Program (NFIP). Standard homeowners policies typically do not cover flood damage.

Hurricane Katrina resulted in $13.1 billion in flood insurance losses in Louisiana paid by the NFIP.

Hurricane Katrina was the costliest hurricane to hit the U.S. (See chart below.)

The number of flood insurance policies in force in Louisiana rose by 27 percent from 388,121 in 2005 to 494,370 in 2006, the year following hurricanes Katrina and Rita. There were 452,823 flood insurance policies in Louisiana in 2015 down from 472,542 in 2014.

Hurricane Katrina was also the deadliest hurricane in Louisiana’s history, with some 1,800 fatalities reported.

The total value of insured coastal property in Louisiana totaled $293.5 billion in 2013, accounting for 36 percent of the state’s total insured property exposure, according to an analysis by AIR Worldwide.

As a result of the devastating impact of Hurricane Katrina, between 2004 and 2007 the total insured value of coastal properties in Louisiana grew at the lowest compound average annual rate of all coastal states (just over 2 percent). Still, in 2007 Louisiana ranked seventh among states in terms of the total value of insured coastal property.

The number of people living in coastal areas in Louisiana increased from 2010 to 2015 by 128,232 people or 4 percent to 3.7 million, according to U.S. Census Bureau estimates. About 79 percent of the total population of Louisiana lived in coastal counties in 2015.

Louisiana Citizens Property Insurance Corp. (Louisiana Citizens) was created by the state legislature in 2003 to oversee the state’s Coastal and FAIR (Fair Access to Insurance Requirements) plans. This state-run entity acts as a market of last resort for residential and commercial property insurance in Louisiana.

Citizens is working to transfer policies back to private insurers, subject to regulatory approval and has completed eight rounds of depopulation.

Louisiana Citizens had a total of 104,084 policies in force for fiscal year 2015. Its exposure to loss—insured value of all properties—was almost $13.9 billion for fiscal year 2015.

Louisiana Citizens was the state’s twenty-ninth largest homeowners insurance company with a 0.8 percent market share in 2016, according to NAIC data sourced from S&P Global Market Intelligence. It was the ninth largest in 2014 and fifth largest in 2010.